Pinterest plans to IPO, Biggest worry from support model using Google and Facebook.
The image community Pinterest published its IPO document on March 23, 2019, and plans to list it in mid-April 2019. This is one of the many well-known technology companies planning to IPO in 2019. According to IPO documents, Pinterest’s revenue remains high. Growing, but still at a loss, this is in line with the financial situation of many other technology companies preparing for IPOs.
According to the Wall Street Journal, Pinterest advanced the IPO’s date and hopes to enter the open market earlier. The company’s valuation was about $12 billion at the time of the last fundraising. Pinterest chose to list on the New York Stock Exchange under the symbol # PINS.
At the end of 2018, the US stock market ended its downturn, especially the tech stocks rebounded strongly. Many companies that raised a lot of money in the non-public market also joined the IPO army. The US Nasdaq exchange index, which is dominated by technology stocks, has grown by about 15% since 2019. Unicorn companies including Lyft, Uber, Slack, etc. are all planning to be listed in 2019, and may become a history in 2019. The largest amount of funds raised since the open market.
According to Pinterest’s IPO document, the company adopts a two-tier shareholding structure. The shares held by existing investors can have a corresponding voting power of 20 votes per share. The shares issued in the open market each have 1 vote, once the existing shareholders hold Less than 4.76% of the shares will lose super-voting rights, mainly because the existing investors and founding teams that hold the majority of the shares after the company’s listing can maintain control of the company. Many technology companies routinely adopt a way to maintain the leadership of the founding team.
The founding team enjoys high listing rewards
After the listing, Pinterest’s founding team will also receive a generous bonus. CEO Ben Silbermann and co-founder Evan Sharp will receive 7 million shares at a price of $7.18 per share for a total value of more than $50 million. It’s no surprise that startups have set up teams and management to get huge bonuses and stock awards after listing, especially in well-known startups, because these companies can also make huge investments in the private market, for IPO The enthusiasm is not high, investors are more inclined to give high listing incentive strategies. Before Snap went public, the company gave CEO Evan Spiegel a $625 million IPO rewards program.
Pinterest went live in 2010 and currently has approximately 265 million monthly active users worldwide, with only the most popular sites on the social platform, Facebook, YouTube and Twitter. Pinterest’s photo community offers billions of images to users, with revenue primarily from advertising on social platforms. Although Pinterest has approximately 184 million overseas users, the company’s revenue is still mainly from the US market. In the fourth quarter of 2018, Pinterest’s revenue was US$273 million, and overseas market revenue was only US$16 million, with a loss of US$63 million. Lower than $138 million in the fourth quarter of 2017.
In 2018, the average revenue per user was $314 million. Compared with other online platforms, Pinterest’s advertising business still has huge room for development. Facebook’s average advertising revenue per user during the same period was $24.96.
Pinterest is still in a loss, and most users will not visit the platform every day, which will lead to huge challenges in the development of advertising business, especially with the partnership between Google and Facebook. Pinterest allows users to use Facebook and Google’s authentication services. User activity depends on Google search service and Facebook support. In the first quarter of 2018, Pinterest’s keyword login page was removed from the Google search results page. In the second quarter of 2018, Facebook adjusted the login authentication system used by the external platform. Pinterest User growth rate and activity have been affected. Pinterest specifically stated in the IPO file that if Facebook and Google stop supporting the login authentication system of their respective platforms or crash, Pinterest may not be able to restore users who have previously logged in this way. It will affect the user’s growth rate and revenue
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